Budget 2025: What It Means for Forestry
Alberta Budget 2025 normalizes forestry spending to $403M after $1.1B wildfire year, with $293M capital plan for parks and wildfire readiness.
Forestry and Parks operating expense
$362M
+$4M from 2024-25 base
Forestry and Parks capital plan
$293M over 3 years
Incl. $47M wildfire capital
Prior year wildfire costs
$707M in 2024-25
Not recurring
Sector Impact Summary
The forestry sector enters Budget 2025 in a transition year, normalizing after two consecutive years of extraordinary wildfire costs. Forestry and Parks total expense drops to approximately $403 million in 2025-26, a staggering $713 million decline from the 2024-25 forecast of $1,116 million. This reduction is almost entirely attributable to the non-recurrence of $707 million in wildfire-related disaster relief from 2024-25, which included costs from the Jasper wildfire and other major fire events. The 2023 wildfire season had similarly required $899 million in firefighting, reforestation, and disaster support.
Beneath the dramatic headline reduction, the base operating budget tells a steadier story. Forestry and Parks operating expense increases modestly to $362 million, up $4 million from the prior year. This includes enhanced wildfire preparation and mitigation funding, partly offset by reductions in other areas. The ministry manages Alberta's forests, preserves provincial parks, enables public land access, manages sustainable rangelands, and promotes environmentally responsible wood products.
The forestry industry faces a dual threat from U.S. tariffs and post-drought forest health challenges. Sawmills and wood preservation products, veneer, plywood, and engineered wood are among Alberta's top 10 manufacturing exports to the United States, and pulp is also a major export category. These products face the full 15% tariff rate on top of existing softwood lumber duties. Three consecutive years of drought have stressed forest health, increasing vulnerability to pests and future wildfire risk. The capital plan allocates $293 million over three years, with significant investments in both wildfire preparedness and provincial parks infrastructure.
Key Budget Measures
Forestry and Parks operating expense: $362 million. A modest $4 million increase from the prior year base, with enhanced wildfire preparation and mitigation funding partly offset by reductions in other program areas. (Source: Government Estimates 2025-26)
Wildfire management capital support: $47 million over three years. Includes:
- Wildfire Enhancement: $22 million ($11M, $11M) for improved wildfire response capabilities.
- Wildfire Facility Upgrade Program: $19 million ($6M annually) for facility improvements.
- Wildfire Management Readiness: $6 million ($2M annually) for operational preparedness. (Source: Capital Plan Details by Ministry 2025-28)
Provincial Parks - Capital Maintenance and Renewal: $116 million over three years ($57 million, $43 million, $16 million). The largest single capital line item for the ministry, addressing deferred maintenance across Alberta's provincial parks system. (Source: Capital Plan Details by Ministry 2025-28)
New Campgrounds Development: $29 million over three years ($2 million, $12 million, $15 million). Expanding campground capacity to meet growing recreation demand. (Source: Capital Plan Details by Ministry 2025-28)
Crown Land Trails: $24 million over three years ($8 million, $10 million, $6 million). Supporting trail development and maintenance on Crown land. (Source: Capital Plan Details by Ministry 2025-28)
Parks Water and Wastewater Infrastructure: $31 million over three years ($5 million, $10 million, $16 million). Upgrading essential utility infrastructure within provincial parks. (Source: Capital Plan Details by Ministry 2025-28)
Funding Changes
| Item | 2024-25 Forecast | 2025-26 Estimate | Change |
|---|---|---|---|
| Forestry and Parks total expense | $1,116M | $403M | -$713M |
| Forestry and Parks operating expense | $358M | $362M | +$4M |
| Wildfire disaster assistance (non-recurring) | $707M | $0 | -$707M |
| Capital investment | $46M | $39M (Yr 1) | -$7M |
(Source: Fiscal Plan 2025-28, Expense tables)
Capital Investment
The Forestry and Parks capital plan totals $293 million over three years ($107 million, $108 million, $78 million):
- Provincial Parks - Capital Maintenance and Renewal: $116 million ($57M, $43M, $16M)
- Parks Water and Wastewater Infrastructure: $31 million ($5M, $10M, $16M)
- New Campgrounds Development: $29 million ($2M, $12M, $15M)
- Crown Land Trails: $24 million ($8M, $10M, $6M)
- Wildfire Enhancement: $22 million ($11M, $11M)
- Wildfire Facility Upgrade Program: $19 million ($6M, $6M, $6M)
- Crown Land General Capital: $9 million ($4M, $3M, $3M)
- Parks regional plan implementation: $12 million (Lower Athabasca and South Saskatchewan combined)
- Wildfire Management Readiness: $6 million ($2M, $2M, $2M)
- Kananaskis Area Trail Upgrades: $5 million ($2M, $2M, $1M)
- Big Island Provincial Park: $5 million ($1M, $5M)
(Source: Capital Plan Details by Ministry 2025-28)
Risks
Increased wildfire frequency and severity. The 2024 wildfire season included the devastating Jasper wildfire, which resulted in $58 million in specific disaster financial assistance. In 2024, 1,320 personnel from across Canada and internationally supported 1,210 wildfires. Three consecutive years of drought have dried forest fuels, and scientists warn that wildfire seasons are becoming longer and more severe.
U.S. tariffs on wood products. Sawmills and wood preservation, veneer, plywood, and engineered wood are among Alberta's top 10 manufacturing exports to the U.S., facing 15% tariffs on top of existing softwood lumber duties. Pulp is also a major export. These layered trade barriers threaten the viability of forest product operations.
Post-drought forest health. Three consecutive years of drought stress have weakened forest health across Alberta, increasing vulnerability to mountain pine beetle and other pest infestations, and elevating future wildfire risk beyond what enhanced preparedness spending can fully address.
Underfunding of wildfire base budget. The $47 million in wildfire capital spending may be insufficient given the escalating frequency and cost of wildfire seasons. The ministry relies heavily on contingency funding for actual wildfire suppression costs, which are inherently unpredictable.
Opportunities
Enhanced wildfire preparedness. New funding for enhanced wildfire mitigation strategies and improved preparedness, with $47 million in wildfire capital spending covering facility upgrades, equipment enhancement, and readiness improvements.
Provincial parks infrastructure expansion. The $116 million for parks capital maintenance, $29 million for new campgrounds, and $24 million for Crown Land trails support Alberta's growing recreation economy and tourism sector. Park visits have been increasing, and expanded capacity addresses a known supply gap.
Environmentally responsible wood products. The ministry mandate includes promoting environmentally responsible wood products, potentially supporting market differentiation for Alberta forest products in markets that value sustainable sourcing.
Jasper recovery and rebuilding. While the Jasper wildfire caused significant damage, the reconstruction effort creates economic activity and opportunities to rebuild with improved wildfire-resilient design and infrastructure.
What's Missing
The budget does not include a dedicated wildfire reserve fund or contingency mechanism beyond the general $4 billion provincial contingency. Given that two of the past three years have seen wildfire costs exceeding $700 million, a specific wildfire financial preparedness mechanism seems warranted. There is no specific support program for forest product companies facing compounded tariff pressure from both the 15% general tariff and existing softwood lumber duties. The budget lacks a comprehensive forest health strategy to address the cumulative impact of three years of drought on Alberta's forests. There is no mention of reforestation programs or funding beyond the emergency measures from prior years.
Net Assessment
The forestry sector faces a challenging year masked by favorable optics. The $713 million decline in total expense reflects the non-recurrence of disaster spending, not program cuts, but the modest $4 million increase in base operating expense provides little margin against escalating wildfire risks and U.S. tariff pressure on wood products. The $293 million capital plan supports both wildfire preparedness and parks infrastructure, but the sector's core vulnerabilities, including climate-driven wildfire escalation and trade barriers, remain largely unaddressed.